Women and Microfinance in Middle-East

Nearly thirty years ago, the initial motivation for microfinance was gender neutral. Particularly poor women, who have proven to be responsible borrowers, benefit from microfinance .

Their status then in both their homes and in their community is elevated when they are responsible of savings and managing loans. The capacity to be self-sufficient and to control their personal income can also contribute to empower poor women. Thus the woman entrepreneur, as the gateway to household stability, becomes a fundamental premise of the microfinance business model and the success of microfinance as a poverty alleviation tool .

Studies have shown that women entrepreneurs use the profits from their businesses to improve their quality of life by sending their children to school, investing in better nutrition, improving their family life and expanding their businesses. In 2006, more than 79 million of women in the world were reached out by microfinance (1). Very small loans and microcredit are given to poor people, mainly women, to become self-sufficient.

Women in poverty do not have options to pay for the unexpected such as illnesses, natural catastrophes and other loses. Micro credit which has been described as the vaccine against poverty helps Middle East women through their ingenuity and hard work and the support of microfinance institutions, to

start their journey out of poverty. In 2009, nearly 75% of women in the Arab region were microfinance borrowers .

In the Middle East there is very little difference between male and female owned firms. It is true that firms owned by women are fewer but they are well established, productive and connected to global markets. This part of the world is already benefiting from female entrepreneurship rooted in a long tradition of women doing business but there is still room for expansion. It is more socially accepted for women to run businesses they have inherited from the family. They have small businesses that generally involve with carpet industry and agriculture.

Although women entrepreneurship is well-established, it has not reached its full potential. In the world, 80% of 105 million of entrepreneurs through microfinance are women and only 2% of them are women from the Middle East .

Female labor force participation is low despite significant gains in education. Women still do not join the labor market because of a variety of social norms. Those who do overcome the barriers however are able to do well.

Today, thanks to our partnership with Pi Slice . the microentrepreneurs in the Middle East have found a new way to see their projects come to life .